For small businesses, Facebook can be a logical place to experiment with paid advertising without the risky investment of a lot of time and money. The social media giant offers an easy way for even the smallest companies to quickly start a targeted ad campaign, displaying business content to Facebook users while they browse the site. Businesses can, for instance, create ads to direct new fans to a Facebook page, ensure that more users see certain posts or send viewers to their websites.

As with most pay-per-click campaigns, businesses set a budget for how much they are willing to spend over a set period. Costs run the gamut, but on average, clicks can cost less than $1 each, depending on whom you are targeting.

These campaigns are easier to monitor than complex pay-per-click search engine marketing because they require much less day-to-day tinkering. They also are less expensive than traditional media ad buys. Done properly, Facebook ads can drive fans to your page and viewers to your website -- and most important, create new customers.

Log into your personal Facebook account.

To get started, log into Facebook and go to the page called Advertise on Facebook by clicking Create an Ad in the dropdown menu next to the Home button. This is in the upper right-hand corner of the main Facebook news feed screen.

Businesses don't actually need a Facebook page to advertise on the site, but the owner or whoever is managing advertising needs a personal account to create, manage and pay for ads. However, ads don't link to personal profiles.

Decide what to advertise.

Next, Facebook wants to know what your ad should link to. You can send users to a specific website, such as a company blog. You also can direct users to a company Facebook page or promote other pages you or your business has created on Facebook, such as events or places.

Pick an advertising goal.

Once you've selected where your ad should link to, decide what you want to accomplish. If you want to build your social media presence by driving fans to a Facebook page, select Get More Likes. If you want to promote specific content on Facebook such as a blog post, select Promote Page Posts.

If you want to drive traffic to a website, click See Advanced Options. All these options are worth experimenting with, but for this demo we will focus on advertising a website.

Design the ad.

Now, it's time to start designing. Facebook ads consist of a simple 25-character headline and a 90-character description, plus a thumbnail photograph. Facebook automatically suggests these, but it's usually better to rewrite them for your intended audience. These can be updated in real-time, so don't be afraid of trial and error.

The site displays images at 100 by 72 pixels, so be sure to use a photo that will still be clear even when it's displayed in a smaller format. Facebook recommends your image be at least this size, although the site automatically resizes images for you.

Facebook has a lengthy set of advertising standards related to what you can and cannot post. For example, ads can't refer to a potential customer's financial status. So before you write any copy, be sure to refer to the site's advertising guidelines.

Target the ad.

You can narrow your ad's audience by targeting specific users. You can micro-target by location down to specific zip codes, then by age, gender and interests. In advanced options, you can segment by relationship status, languages spoken, college attended, workplace or just your own fans. By a process of trial and error, you can whittle down your audience from Facebook's roughly 167 million users in the U.S. to as few as 20 people, if your marketing goal is to target specific decision-makers.

Set name, pricing and schedule.

Next, it's time to name your campaign, and then set your budget and schedule. The name should be distinct, perhaps something related to whom you are targeting. A simple descriptor, such as "college grads," can be effective as long as it helps keep you organized.

Then, tell Facebook how much money you are willing to spend. This can either be a daily budget or a lump sum of total spending while the ad runs. Payment is either per click -- you pay every time someone clicks your ad -- or per thousand impressions -- you pay every time one thousand people see the ad. You can set ads to run continuously or through a specific date and time.

Pay for the ad.

After submitting your first ad, Facebook will prompt you for payment information -- credit card, direct debit, PayPal or a Facebook Ad coupon. Billing is monthly. Facebook can hold your ad, usually for about a day, so it can approve its content.

Monitor your campaign.

Now that your campaign is up and running, you'll want to follow its progress by using the Ads Manager tool, accessed from the left-hand side of your personal Facebook account. The ads manager shows detailed information about your campaigns, including budget, spending and schedule.

Clicking an ad campaign will take you to a dashboard with even more information, including a series of charts and performance metrics. From here you can view how many people have viewed your ad, how often it shows up in news feeds, number of clicks and click-through rates. The two most important metrics are clicks -- what you're paying for -- and actions, which show that people are interacting with your ad.

Generate a report.

You can export reports from the Reports tab in the ads manager. These are spreadsheets or HTML files that can be used to assess and compare ads. This critical function provides intricate data that offers enterprise-level insight into an ad campaign, such as the demographics of people who are clicking on your ads or the amount of time between when a user clicks on an ad and likes a page.

Manage your ads and tweak as you go.

If an ad is underperforming, change its attributes by selecting the campaign it belongs to and then clicking on the specific ad. You can edit the text, increase or decrease your bid, or adjust the target audience.

You also can use your successful ads as templates by clicking, Create a Similar Ad in the editor. This will launch a new Create an Ad page with settings pre-selected.